How to Know If Your SME Is Ready for a Part-Time Finance Director

Introduction - Ready for a Part-Time Finance Director?

Running a construction or engineering business isn’t easy. The numbers get bigger, projects overlap, and suddenly you’re managing cashflow, suppliers, and staff all at once.

Many SMEs start out with a bookkeeper or year-end accountant, but as turnover grows beyond £500k, the numbers become too important to leave on autopilot. This is where a part-time Finance Director (FD), also known as a fractional FD, can transform your business.

At Jones Financial Accounts (JFA), we specialise in helping SMEs in construction and engineering move from reactive bookkeeping to proactive financial leadership. This blog will explain how to know if you’re ready for a part-time FD, why it matters, and what the right strategy looks like.

What You Need to Review

The first step is to review whether your current financial setup matches the complexity of your business. For a construction or engineering SME, the red flags usually appear in three areas:

Cashflow visibility

If you can’t clearly see what money is coming in and going out over the next 30–90 days, you’re at risk of hitting a funding wall. Construction projects often rely on stage payments and retentions, so without forecasting, liquidity dries up fast.

Decision-making

Are you making calls on pricing, hiring, or equipment purchases based on gut feel rather than data? If so, you’re guessing, and guessing can cost millions when margins are already tight.

Reporting 

Year-end accounts tell you what happened in the past. If that’s all you’re relying on, you’re flying blind. Monthly management accounts, project profitability reports, and KPIs are essential to run multiple jobs with confidence.

If you spot these gaps, it’s time to consider whether your business is ready for FD-level guidance, even on a part-time basis.

Why It Matters for Businesses

Getting this decision right can make the difference between sustainable growth and financial chaos.

A part-time FD gives you forward-looking clarity. You can predict cash shortages before they happen, secure funding when needed, and make confident bids knowing your costs are covered.

For example, we’ve seen SMEs increase project profit margins by 5–10% simply by introducing tighter cost-to-complete forecasting. That kind of improvement on a £2m turnover business means an extra £200k on the bottom line.

Without FD oversight, businesses grow busier but not more profitable. A construction firm might take on five new contracts, only to discover too late that margins are eroded by poor pricing or late-stage payment terms.

Suppliers lose trust, banks hesitate to lend, and directors are left putting in personal funds to cover payroll.

In short, ignoring the need for FD-level insight risks lost profit, strained relationships, and even insolvency. Getting it right creates stability, credibility, and a stronger growth platform.

Strategy to Get It Right

If you’re unsure whether now is the time, here’s a structured approach to test readiness:

1. Audit your reporting

   Ask yourself: do I have monthly management accounts, cashflow forecasts, and project-level cost reports? If not, start here.

   
   

2. Identify leadership gaps 

   Look at where directors’ time is being spent. If owners are buried in spreadsheets rather than growing the business, a part-time FD can fill the gap.

   
   

3. Start small

   You don’t need a full-time FD straight away. Begin with 10–15 hours a month to focus on immediate pain points, such as cashflow forecasting or supplier negotiations.

   
   

4. Review results after 90 days

   A good FD should create tangible benefits quickly, such as better funding terms, improved margins, or reduced time spent by directors on finance.

   
   

5. Scale as needed

   As the business grows, increase FD input to support strategic planning, tenders, and investment decisions.

   
   

This staged approach ensures you only pay for what you need while securing FD-level expertise to guide critical decisions.

Common Mistakes (with Consequences)

• Waiting for a crisis. Too many firms only bring in FD support after cash has run out. By then, options are limited and recovery is harder.

  
  

• Confusing a bookkeeper with an FD. Bookkeepers record transactions; FDs interpret them and advise strategy. Mixing the two leaves leadership blind.

  
  

• Ignoring compliance. VAT errors, CIS mistakes, or missed filings can lead to HMRC penalties, reputational damage, and strained supplier relationships.

  
  

• Overestimating internal capability. Project managers and directors are not finance specialists. Expecting them to double as accountants risks both poor projects and poor financial control.

Misconceptions

• “We’re too small for an FD.” In reality, once turnover passes £500k, and especially if multiple projects are running, the business risks outgrowing basic bookkeeping.

  
  

• “It’s too expensive.” A part-time FD costs a fraction of a full-time salary but delivers the same strategic expertise. It’s an investment, not a cost.

  
  

• “My accountant already does this.” Year-end compliance accountants focus on tax and filing. FD support is about decision-making, forecasting, and growth strategy, completely different skill sets.

  
  

Why Professional Support Pays Off

At Jones Financial Accounts (JFA), we act as the bridge between compliance and strategy. For construction and engineering SMEs, this means:

• Protecting margins by tightening cost controls and highlighting underperforming projects early.

  
  

• Securing confidence from banks, suppliers, and investors with accurate, credible numbers.

  
  

• Saving time for directors by handling reporting, forecasting, and commercial analysis.

  
  

• Reducing risk by ensuring compliance with VAT, CIS, and HMRC deadlines while improving financial processes.

  
  

In practice, this means your business grows with fewer surprises, fewer sleepless nights, and more money left at the end of the year.

Key Takeaways

• If you can’t see clear monthly numbers, you may already need an FD.

• Growth without FD-level insight leads to cash strain and lost profit.

• A staged approach, starting part-time, is the safest way to add FD expertise.

• Professional support turns financial chaos into clarity, confidence, and control.

Wrapping up today's insights, tomorrow we simplify another accounting challenge